💥Do Kwon's NEW Political Scandal,🔥Bitcoin's Failure in Africa,⚡JP Morgan Revolutionizing Payments in India

Your 5 minute emerging markets web3 weekly update

In This Issue

Eastern Europe
🔸Scandal Brewing, Montenegro Calls for Probe Into Financial Ties Between Do Kwon and Political Leader
🔸Decline in Demand, Russian Interest in Crypto Wallets Drops by 35%

Asia
🔸Building the Future of Finance, JPMorgan and Indian Banks Collaborate on Blockchain-Based Interbank Settlement in GIFT City
🔸North Korean Hacking Group Strikes Again, $35 Million Stolen from Atomic Wallet Users

Africa
🔸Bitcoin Failed in the CAR, Is Africa Ready to Adopt Cryptocurrencies as Legal Tender?
🔸Layoffs and Over-Spending, Pan-African Crypto Company Mara Faces Setbacks

Latin America and the Caribbean
🔸El Salvador Unveils $1 Billion Renewable Energy-Powered Bitcoin Mining Project
🔸BEE4 Secures Approval to Extend Sandbox, Plans to Revolutionize Tokenized Share Market in Brazil

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Eastern Europe

Image Credit: EPA-EFE/Boris Pejovic

Outgoing Montenegrin Prime Minister, Dritan Abazovic, along with political parties and NGOs, has called for an investigation by the Special State Prosecution into alleged business relations between Do Kwon, the founder of collapsed cryptocurrency company Terraform Labs, and former Finance Minister, Milojko Spajic, leader of the Europe Now political movement in Montenegro. Do Kwon sent a letter to Abazovic, outgoing Justice Minister Marko Kovac, and the Special State Prosecution, claiming that he financed Europe Now, leading to concerns about the movement's involvement with him. Abazovic confirmed receiving the letter and emphasized the need to avoid Montenegro becoming a breeding ground for global fraudsters, while Spajic denied the claims and stated that he reported Kwon to the authorities upon his arrival in Montenegro.

The demand for crypto wallets in Russia has declined, with a 35% decrease in web requests for crypto wallets compared to the previous year. Yota specialists analyzed network data and found that the traffic for crypto wallet queries decreased by 35% in spring 2023 compared to the same period in 2022. The decline in interest is particularly notable among young people aged 21 to 35, who accounted for 61% of total traffic in 2022 but experienced a 10% decrease in interest in 2023, while the older generation is showing increasing interest in digital assets.

Asia

Image Credit: Shubham Dhage via Unsplash

JPMorgan Chase has partnered with six Indian banks, including HDFC Bank, ICICI Bank, and Axis Bank, to introduce a blockchain-based platform for settling interbank dollar transactions in Gujarat International Finance Tec-City (GIFT City). The pilot project, using JPMorgan's blockchain platform Onyx, aims to enable real-time settlement round-the-clock, overcoming the limitations of the existing system that takes hours and excludes weekends and public holidays. The move positions GIFT City as an alternative trading center to Singapore and Dubai, bolstering India's efforts in the international financial landscape.

North Korea's Lazarus Group is suspected to be behind the theft of at least $35 million in cryptoassets from users of Atomic Wallet, a popular non-custodial cryptocurrency wallet service. Elliptic, a blockchain analytics firm, has traced the stolen funds and identified victim wallets, allowing exchanges and other crypto businesses to identify any deposits originating from the hack. The laundering of the stolen cryptoassets and the use of specific services match past patterns employed by Lazarus Group, making them a highly probable perpetrator in this case, marking their first major crypto theft since the $100 million exploit of Horizon Bridge in June 2022.

Africa

Image Credit: David Pupăză via Unsplash

The experiment to legalize Bitcoin in the Central African Republic (CAR) has failed, with the country's legislature repealing the law in March that made Bitcoin legal tender in a headline grabbing move last year. The low internet penetration rate of less than 12%, infrastructure deficit, and high internet prices in the CAR posed significant challenges to adopting Bitcoin as a transacting currency. However, the attempt to adopt Bitcoin as legal tender was fraught from the start and met with disagreement among the Members of Parliament and the Bank of Central African States, the regional central bank that serves six central African countries. Now that the dust is settling, the questions remains, is anywhere in Africa ready to adopt cryptocurrency as legal tender?

Pan-African crypto company Mara is reportedly facing financial difficulties and has laid off around 85% of its employees and implemented salary cuts for remaining staff as part of a restructuring phase. Sources claim that Mara engaged in over-spending, including heavy marketing expenses and excessive compensation packages, which contributed to its financial struggles. Mara's plans to launch its own blockchain and native token have been halted following the collapse of FTX, causing funds to dry up and revenue to fall short of expectations.

Latin America and the Caribbean

Image Credit: Derek Sutton & Anastasia Palagutina

A public-private partnership in El Salvador, known as Volcano Energy, plans to invest $1 billion in creating a large-scale bitcoin mining farm. The project will be backed by "key Bitcoin industry leaders" and renewable energy developers, utilizing solar and wind energy in the power generation park in the municipality of Metapan. The El Salvador government will hold a preferred participation equivalent to 23% of the revenues, while private investors will hold 27%, with the remaining 50% reinvested into infrastructure. The stablecoin provider, Tether, confirmed its participation in the initial investment, without specifying the amount contributed.

BEE4, a Brazilian trading platform for tokenized shares of emerging companies, has obtained authorization from the Brazilian Securities Commission to extend its sandbox deadline to June 2024. The platform plans to launch tokenized shares for three companies and establish agreements with brokerages for token distribution. BEE4 aims to transition its distribution to third-party brokerages in the future and focus on other areas of the business, such as marrying retail and institutional investors, leverage consultants to help companies request share offerings, promote access to the benefits of a digitized economy, while ensuring a secure environment for new businesses.

Thanks for reading and have a great week ahead!

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Written by Jon Lira. Connect with him on LinkedIn.

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